POWER TARIFF

Calculation of Tariff for Thermal Power Plant

 Nominal Tariff
 Discounted Tariff
 Levelised Tariff

Nominal Tariff: Calculated for each year (Fixed Price + Variable Price )

Discounted Tariff: Calculated at “Present Value of Future Nominal-Tariffs” done by discounting

future Tariff by a discounting future Tariffs by a discounting Factor based on Discounting Rate.

Discounted Tariff =Nominal Tariff * Discounting Factor

D.F. = 1/(1-d)^n

N = no of years, d= discounting rate

Levelised Tariff : Tariff calculated for all years .This is a single Tariff for whole Plant life . it is a
weighted mean of all nominal tariff where weigh by the discounting factor (D.F.)

Assumption and other Norms:

IDC (Interest during Construction) is added in the capital cost where INFIRM POWER is revenue used
to be deducted from the Capital cost.

Working capital: It includes receivables for two months, Salary & Wages for one month, spares for
one and half month for TPP.

Total cost = Fixed (capacity) cost + Variable (Energy) Cost

Fixed (capacity cost) components:

1. Return on Equity
2. Return on Debts(loan)
3. Depreciation
4. Interest on Working Components
5. Operational & Maintenance Cost

Variable cost Component

1. Cost of COAL/kwh
2. Cost of OIL/kwh (from 2009-14) it shift to Fixed Cost.
 Assumption & Data Given for TPP    
Project Cost (Rs.Crores / MW) 4.00 Assumption
Plant Capacity (MW) 500.0 Assumption
Plant Life (years) 25.0  
     
Capital Structure    
Debt(Percentage) 70% (CERC Norms 2009-14)
Equity(Percentage) 30% (CERC Norms 2009-14)
Debt (Rs.Crores) 1400.0  
Equity (Rs.Crores) 600.0  
Assumptions for Capacity Charges    
Interest on Loan capital 12% (CERC Norms 2009-14)
Interest on Working capital 12% (CERC Norms 2009-14)
Return on Equity 15.50% (CERC Norms 2009-14)
O&M expenses ( in % of TPC ) 2.00% (CERC Norms 2009-14)
O&M Expenses Escalation 5.75% (CERC Norms 2009-14)
Maintenace Spares Cost Escalation 6% (CERC Norms 2009-14)
Depreciation (for Tariff Clculation) 5.28% (CERC Norms 2009-14)
Depreciation as per IT Act 7.84% (As per IT Act)
Total number of Years of Operation 25.0 (CERC Norms 2009-14)
Loan Duration (years) 12.0 (CERC Norms 2009-14)
Assumptions for Variable Charges    
Cost of Coal(Rs./Ton)(Price + Freight) 804.0 Price-Acc.to Grade of Coal,
    Freight-Acc.to Min.of Railways
Ministry of Petroleum & Natural
Secondary Fuel Prices (Rs./kl)   Gas
Secondary Fuel Consumptions(ml/kWh) 1.00 (CERC Norms 2009-14)
 TECHNICAL ASSUMPTIONS
 
Installed Capacity of single unit 500.0 MW
No. of installed units   -- 
Total Installed Capacity   MW
3504.
Total units generated 0 million units
Target Availability Factor 95%  
PLF 85%   (CERC Norms 2009-14)
2780.
Gross Station Heat Rate 0 kcal/kWh (CERC Norms 2009-14)
3420.
GCV of Coal 0 kcal/kg Ministry of Coal
GCV of Oil 10.7 kcal/ml Ministry of Petroleum
Auxiliary Consumption 10%   (CERC Norms 2009-14)
Coal Transit Loss 0.80%   Ministry of Coal
Energy Delivered ExBus (Million units)    
THE PLANT IS COAL FIRED WITH COOLING TOWER

MU per Annum = MW*365days*24hrs*PLF*A.F.*1000/10^6